The Morning Brief - Lignet

Switzerland: Has the Currency Cap Worked and Can It Hold?

For decades, Switzerland has prospered as a shelter from global economic, political and financial storms, delivering both a long-term store of value and a secure jurisdiction for foreign wealth. Remarkably, it has sustained this achievement for the past 30 years or so in the context of a flexible exchange rate and capital account. A huge currency appreciation in 2011 highlighted the vulnerability of the Swiss economy and the euro exchange rate was capped later that year. This special analysis looks at the Swiss currency cap, whether it can be sustained, and the risks it poses for Switzerland.

Drone Leaks Could Undermine Counterterrorism Efforts
The leak of a Justice Department memo on U.S. drone policy to conduct targeted killings of suspected al-Qaeda members coupled with a high-profile debate on Capitol Hill over this issue could undermine this highly effective program by increasing international pressure on the U.S. use of attack drones and possibly reduce their effectiveness. The leak could also put the Obama administration and CIA officials at increased risk of politicized legal actions abroad, as LIGNET explains.
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Nigeria Violence Unlikely to Stop Despite Ceasefire Offer
The Nigerian radical Islamist group Boko Haram proposed a ceasefire last week, but it’s not likely to stop the violence that has devastated Nigeria, as factionalism within the group will make it difficult, if not impossible, to enforce. Previous offers have also been met with skepticism from the government, especially because there has been little indication that the leadership of Boko Haram is seriously interested in stopping its deadly attacks.
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North Korea: Nuclear Test Shows Limits of Chinese Influence
North Korea, which recently posted a YouTube video on a government web site showing an American city in flames following a missile attack, followed through on its threat to conduct a third nuclear test early today despite pressure from China not to do so. North Korean officials claim they tested a miniaturized nuclear device, a development that could allow Pyongyang to construct a warhead for a ballistic missile. LIGNET is skeptical of this claim, as we explain in this special analysis.
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Russia: Space Exploration Plan Backed by Military Goals
Russia’s announcement that it will spend $70 billion over the next seven years on space exploration has caught the West by surprise, and may be cause for concern as Moscow’s plan includes an ambitious mix of scientific and commercial projects, many of which will enhance Russia’s ability to use space for military purposes.
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Bahrain’s Goal: Keep Shiites Down and Iran Out
Talks between Bahrain’s Sunni government and its Shiite opposition groups, which began over the weekend, are unlikely to resolve the simmering unrest that has plagued the country since its Arab Spring protests began two years ago. But the talks are nonetheless a wise strategy that could weaken Iran’s influence in the country, as LIGNET explains.
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Mexico Cleans Up a Judicial MessMexico Cleans Up a Judicial Mess
Mexico’s decision to finally free Florence Cassez, a French national convicted of participating in a kidnapping ring in 2005, eliminates an embarrassing judicial controversy that has shined a bright light on the country’s corrupt criminal justice system. While Cassez’s release helps Mexico’s image, it does nothing to fix the larger problems in its malfunctioning judiciary, as LIGNET explains.
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British MP: UK Military Being Hollowed Out
Once one of the world’s great powers, Britain is now on the verge of irrelevance as its military continues to be hollowed out by what Tory MP Patrick Mercer calls “devastating” budget cuts. Without a robust military and force projection capability, Britain’s overseas interests could be at increased risk, as LIGNET explains.
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